Oakland solar company Sungevity files for bankruptcy

Updated 5:03 pm, Tuesday, March 14, 2017

Installers working with Sungevity attach solar panels to a roof in San Francisco in 2009. The Oakland solar company reported Monday that it had filed for bankruptcy protection.

Installers working with Sungevity attach solar panels to a roof in San Francisco in 2009. The Oakland solar company reported Monday that it had filed for bankruptcy protection.

Photo: Hardy Wilson, The Chronicle

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Sungevity installation crew member Jeremiah Eanes scales a roof on a home at 1236 6th Avenue in San Francisco, Calif., after installing solar panels on Thursday, May 14, 2009. Sungevity, which is based out of Berkeley, Calif., installs solar panels on local homes and uses Microsoft Virtual Earth to calculate how to install them and what they will cost. less

Sungevity installation crew member Jeremiah Eanes scales a roof on a home at 1236 6th Avenue in San Francisco, Calif., after installing solar panels on Thursday, May 14, 2009. Sungevity, which is based out of ... more

Photo: Hardy Wilson, The Chronicle

Oakland solar company Sungevity files for bankruptcy

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Oakland’s Sungevity has filed for Chapter 11 bankruptcy protection, the latest example of a solar company struggling to stay afloat even as the technology’s popularity rises.

A collection of investors, led by Northern Pacific Group, has agreed to take control of Sungevity’s assets in exchange for $20 million in financing to keep the company’s operations going. Those assets will then be sold off in a court-supervised auction, according to Sungevity.

The company specializes in a software platform that connects homeowners interested in going solar with installers who could perform the work, supplying instant online quotes. Although executives touted their asset-light model and aggressively expanded both in the United States and Europe, Sungevity’s share of the residential solar market remains well behind such competitors as SolarCity and Sunrun.

Last year, privately held Sungevity planned to go public in unusual fashion, merging with a “blank check” company set up by investors to take a promising firm into the public markets. But a brutal year for solar stocks — as well as the incoming Trump administration’s perceived attitude toward renewable power — gave the deal’s backers second thoughts, and they canceled the transaction in December.

Since then, Sungevity has been shedding staff, cutting roughly 100 jobs in January and another 400 last week, according to a former employee.

“The board and its advisers reviewed a range of options and ultimately decided that a court-supervised sale represents the best path forward for our customers, suppliers, employees and business partners,” CEO Andrew Birch said in a press release.

Analysts say that in some states, including California, the pool of early adopters is starting to dry up. That forces rooftop solar companies to spend more money reaching out to other potential customers and places intense pressure on profit margins. In addition, utilities in many states are pushing regulatory changes to slow solar power’s growth.

Even the field’s leaders are struggling. SolarCity, the nation’s largest residential solar company, suffered through a string of widening annual losses before being acquired last year by electric car maker Tesla, in a deal that some critics called a bailout for the solar firm.

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